LOCAL 19, WAREHOUSE, ETC. v. Buckeye Cotton Oil Co., 12652.

• Decision Date: 22 August 1956
• Docket Number: No. 12652.,12652.
• Citation: 236 F.2d 776
• Parties: LOCAL 19, WAREHOUSE, PROCESSING AND DISTRIBUTIVE WORKERS UNION, RETAIL, WHOLESALE AND DEPARTMENT STORE UNION, Affiliated with Congress for Industrial Organizations, Appellant, v. The BUCKEYE COTTON OIL COMPANY, Appellee.
• Court: U.S. Court of Appeals — Sixth Circuit

236 F.2d 776 (1956)

LOCAL 19, WAREHOUSE, PROCESSING AND DISTRIBUTIVE WORKERS UNION, RETAIL, WHOLESALE AND DEPARTMENT STORE UNION, Affiliated with Congress for Industrial Organizations, Appellant, v. The BUCKEYE COTTON OIL COMPANY, Appellee.

No. 12652.

United States Court of Appeals Sixth Circuit.

Decided August 22, 1956.

Anthony J. Sabella, Memphis, Tenn. (W. Thomas Williams, Memphis, Tenn., on the brief), for appellant.

James O. Coates, Cincinnati, Ohio (Harry W. Laughlin, Jr., Memphis, Tenn., on the brief), for appellee.

Before SIMONS, Chief Judge, ALLEN and MILLER, Circuit Judges.

ALLEN, Circuit Judge.

This appeal arises upon a motion for summary judgment entered in favor of defendant in the trial court.¹ The complaint filed under Section 301 of the Labor Management Relations Act, 1947, 29 U.S.C. § 185, 29 U.S.C.A. § 185, alleged the existence of a collective bargaining agreement between the parties, providing terms in respect to hours of work, wages and working conditions, and also providing in Article VIII for mutual and voluntary arbitration of grievances. The pertinent part of Article VIII reads as follows:

"A grievance is defined to be any difference between the Employer and any employee, or employees, covered by this agreement as to any matter involving the interpretation or application of this agreement, or as to any matter directly affecting the employee in respect to hours of work, wages, or working conditions. Should any grievance arise it shall be settled in the following manner:

"First: Between the employee and his shop steward and the foreman or supervisor of the particular department; if not settled, then,

"Second: Between the Plant Grievance Committee and the Mill Superintendent or other representative designated by the management. * * * If not settled, then,

"Third: The matter shall be taken up between the Grievance Committee, a representative of the Union and a representative of the Management. * * *

"Fourth: If no mutual agreement has been reached on a matter involving the interpretation or application of any provision of this Agreement, the matter shall, if other party so requests, be taken up by a Board of Arbitration composed of a representative of the Employer, a representative of the Union, and a third party selected by, and mutually agreeable to, the Union and the Employer. If the Union and the Employer cannot agree on the selection of the third party, they shall request the American Arbitration Association to submit a list, or lists, of arbitrators from which a mutually agreeable third party shall be selected by the parties. It is understood that only grievances involving the interpretation and application of this Agreement may be brought to arbitration except that it is agreed that the question of general wage increases or decreases shall not be subject to any part of the grievance procedure, including arbitration.

"In considering a grievance as provided for above, the Board of Arbitration shall limit itself only to the grievance as stipulated in writing jointly by the Employer and the Union, and shall neither add to nor subtract from the stipulated grievance or the terms of this Agreement. A decision of the majority of the three arbitrators shall be final and binding on both parties."

The complaint averred that defendant violated the collective bargaining agreement as to working time by employing members of the plaintiff union in excess of 40 hours in any one week and for seven consecutive days without paying the compensation agreed upon, that defendant had refused to pay under the contract, that plaintiff demanded that the grievance be submitted to arbitration, but that defendant had refused to arbitrate. It was alleged that this refusal would cause substantial and irreparable damage and that there was no adequate remedy at law. The complaint prayed for judgment enjoining defendant, its officers and agents, from violating the agreement as to payment for overtime work, for money judgment for wages found due, and "That the Court order the Defendant to submit this dispute to arbitration in accordance with the terms of the collective bargaining Agreements, and that it cooperate with the Plaintiff in the choice of a third arbitrator."

Defendant filed a motion to dismiss the complaint. Subsequently a motion for summary judgment was filed by plaintiff. The court sustained the motion to dismiss the complaint upon the ground that the court lacks jurisdiction of the subject matter and on the further ground that the complaint fails to state a claim upon which relief can be granted.

In its oral opinion the court stated in effect that the decision of the Supreme Court of the United States in Association of Westinghouse Salaried Employees v. Westinghouse Electric Corporation, 348 U.S. 437, 75 S.Ct. 489, 99 L.Ed. 510, required the dismissal of the complaint. That case held that Section 301 of the Labor Management Relations Act, 29 U.S.C. § 185, 29 U.S.C.A. § 185, withholds from the federal district court jurisdiction over suits by a labor union for employees' unpaid wages. The District Court in its oral opinion herein stated that "the Westinghouse case settles a number of the questions in this case to considerable extent, if not this whole lawsuit." The court declared that since the Westinghouse case denied enforcement of wage demands in an action based on Section 301, enforcement of a contract to arbitrate with regard to alleged unpaid overtime wages based on Section 301 must also be denied. The District Court also indicated that state law governs, and declared that under Tennessee law executory contracts to arbitrate are not enforceable. Cf. Cole Manufacturing Co. v. Collier, 91 Tenn. 525, 19 S.W. 672; Key v. Norrod, 124 Tenn. 146, 136 S.W. 991. Finally, the court held that this is a labor dispute in which injunctive relief is prohibited by the Norris-LaGuardia Act, 29 U.S.C. § 101 et seq., 29 U.S.C.A. § 101 et seq.

At the hearing on the motions counsel for plaintiff stated that the only maintainable portion of the complaint is "the action seeking a mandatory injunction to compel defendant to arbitrate." This was the question considered and decided by the District Court and also is the question presented here.

We think the problems involved are not so easily solved as indicated below.

As to the application of the Westinghouse case, while the complaint herein originally involved payment of wages, the arbitration is sought under a collective bargaining contract in which provisions establishing the arbitration method of negotiation and settlement constitute an important feature, and are made applicable to many issues other than those of wages or hours. A grievance as defined above thus covers problems not involved in the Westinghouse decision. There the controversy related only to the payment of back wages. The enforcement of an arbitration agreement was not sought and the question of arbitration was not raised. The right set up was individual to the employee. This distinction was pointed out by the First Circuit in Local 205, United Electrical, Radio and Machine Workers of America v. General Electric Company, 1 Cir., 233 F.2d 85, 100. The court there stated:

"* * * the effect of the Westinghouse holding, reflected in all the opinions of the majority justices, was to eliminate from § 301 jurisdiction a complaint by a union that involves no more than a cause of action which is `peculiar in the individual benefit\' or `the uniquely personal right of an employee\' or which `arises from the individual contract between the employer and employee.\' 348 U.S. at pages 460, 461, 464, 75 S.Ct. at pages 500, 501, 503. That holding was not aimed at any cause of action or remedy that appropriately pertains to the union as an entity, particularly one which an individual employee may have no equal power to enforce. The promise of the employer to arbitrate, which frequently is linked in the contract or in negotiations with a union no-strike pledge, seems to us to be at the forefront of the contract terms for whose breach only the union can effectively seek redress * * *."

The complaint here seeks relief broader than and distinct from money judgment. This is an action to compel the use of a negotiating device voluntarily agreed upon between management and labor and extensively used. In an exhaustive article, "The Enforcement of Grievance Arbitration Provisions," by William P. Murphy, 23 Tenn.Law Review 959, it is estimated that similar arbitration provisions exist in some 90% of the labor bargaining contracts. The enforcement of this agreement means that, if in the future a controversy arises over conditions of work or the application or interpretation of the agreement, either party may secure a settlement by arbitration rather than by work stoppage or lockout.

Defendant urges that the prayer for enforcement of the arbitration provision is in effect identical with a prayer for money judgment. This contention cannot be sustained. It is in fact conceivable that if the arbitration is instituted in accordance with the bargaining agreement a majority of the members of the Board of Arbitration might vote in favor of defendant's contentions and deny those of the union. What plaintiff seeks here, although it hopes that it will secure an award in its favor, is that this bargaining feature be used. The court in its order dismissing the complaint finds that plaintiff relies upon this one prayer of the complaint.

Defendant also contends that the bargaining contract provides for voluntary agreement and that if arbitration is ordered by this court it will not be voluntary. The bargaining agreement was entered into voluntarily and, like any other contract, the contract for arbitration falls within the purview of Section 301 and is enforceable thereunder.

We conclude that the Westinghouse case is not controlling.

Assuming, but not deciding, that if Tennessee law applies, the arbitration contract being...